Pensioners have had £220bn of their wealth wiped out in the past year as a result of the housing crash, new research reveals. It shows that pensioners in England and Wales who own property have lost an average of £52,000 each.

The analysis, by the website propertyfinder.com, shows that pensioners have been particularly hard hit, because while they make up less than a sixth of the population, they own a third of the country's property by value. The total value of pensioner property in England and Wales has fallen to £800bn.

According to the report, retired people own half the property by value on the south coast and even more of the equity. The UK's top "inheritance hotspot" is Christchurch in Dorset, where pensioners own 54% of the property stock by value. They also own more than half in Rother, East Sussex, and in West Somerset and East Devon. By contrast, eight out of the 10 areas in which pensioners own the lowest proportion of housing are in London.

A recent report from the website uswitch.com revealed that almost 14% of pensioners are relying on property to fund their old age. But the housing downturn has hit both relatives' hopes of a large inheritance and many pensioners' plans to supplement pensions with income from their homes.

The annual rate at which house prices are falling increased to 12.3% in February, according to figures from the Department of Communities and Local Government. The average price in the south west of England, where much of the pensioner wealth is concentrated, has fallen from £196,818 to £163,337 in that time, according to the Land Registry.

"While some may eye the falling value of inheritances with dismay, the correction in the housing market represents a partial reversal of the huge transfer of wealth we have seen in recent years from young to old," said Nicholas Leeming, director of propertyfinder.com. "Now we can look forward to a much healthier spread of wealth between generations - and perhaps fewer grasping relatives after the family silver."